Law System Reformed Pension Savings.

Original Language Title: RÉFORMASE LA LEY DEL SISTEMA DE AHORRO PARA PENSIONES.

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DECREE No. 1036 LEGISLATIVE ASSEMBLY OF THE REPUBLIC OF EL SALVADOR, CONSIDERING
:
I.- by Legislative Decree No. 927, dated December 20, 1996, published in the Official Gazette No. 243, Volume No. 333, 23 of the same year, the Law of Pension Savings System was issued.
II.- by Legislative Decree No. 98, dated September 7, 2006, published in the Official Gazette No. 171, Volume No. 372, 14 of the same month and year, the Trust Act pension obligations issued .
III.- System Act regulates Pension Savings cessation of compulsory contributions to the system when the person reaches the legal age for retirement, assuming that was also reached twenty five years of continuous or discontinuous quotes It is the case that much of the population reaches retirement age without completing the twenty-five years of contribution, which causes them trouble getting benefits under the system; so it becomes necessary to allow them to continue trading despite having met the age requirement for retirement.
IV.- That Law System Pension Savings regulates investment of pension funds in different types of financial instruments, including investment certificates Previsionales. V. That
under the Trust Act pension obligations, the Trust Certificates issued pension obligations Pension Fund Investment to meet the obligations generated the pension system, being necessary to update the investment limit established in Law Savings System for Pensions in such Certificates and comply with the Annual Program Emissions of said Trust. That
VI.- also the circumstances of the current Pension Savings System requires updating some provisions of the Law on Pension System in order to provide users of the same, greater opportunities for coverage and pension benefits, encouraging turn, improvements in the profitability of the pension funds.
THEREFORE,
in exercise of its constitutional powers and initiative of the President of the Republic, through the Minister of Finance and the deputies Guadalupe Lorena Peña Mendoza, Norma Guevara Ramirios Fidelia, Orestes Ortez Fredesman Andrade and Inmar Rolando Reyes.
DECREES the following:


2 AMENDMENTS TO THE LAW SYSTEM FOR PENSIONS
Art SAVINGS. Article 13 1. reformed as well.
"Mandating Quotes
Art. 13. During the term of the employment relationship should be made mandatory monthly contributions to the system by workers and employers.
The obligation to cease trading in any of the following situations:
a) When the member is pensione old age, in accordance with the provisions of Articles 104, 200 and 202 of this Act or receive the benefit of return balance, according to the provisions of Article 126 of this Act;
B) When the member is declared totally disabled by second opinion;
If a member continues to work being pensioned for total or partial disability, having been declared this by issuing a first opinion or being pensioned partial disability by issuing a second opinion, it should proceed to find out the contribution to referred to in paragraph a) of Article 16 of this Act and in addition, the commission established in paragraph d) of Article 49 of the same.
Also disability pensioners because of occupational risks may quote rates the previous paragraph, according to which marks the final paragraph of this article.
The provisions of the preceding paragraph shall also apply to disabled members who have received repayment of the balance in accordance with Article 125 of this Act and to continue working and trading for access to old-age benefits.
The cessation of the obligation to contribute will operate without prejudice to the voluntary contributions that members decide to make and agreements between employer and employee to make additional contributions, fulfilled the conditions for the cessation of such obligation. "
Art . 2. Article 16 reformed so.
"Amount and distribution of contributions
Art. 16. Employers and workers contribute to the payment of contributions within the system in the proportions set forth in this Law.
The contribution rate will be thirteen percent of the respective base contribution income.
This contribution will be distributed as follows:

A) Ten point eight percent (10.8%) of the contribution base income will be allocated to the individual account
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pension savings affiliate. Of this total, six point five percent (6.25%) of the contribution base income will be contributed by the worker and four point fifty-five percent (4.55%), by the employer;
B) Two point two percent (2.2%) of the contribution base income will go to contract insurance and disability established by this Act and the payment of the managing institution for the administration of individual accounts pension savings. This percentage will be paid by the employer. "
Art. 3. reformed the literal m) of Article 91 as well.
"M) Pension Fund Investment Certificates issued by the Trust pension obligations, will have a maximum limit of 45% of the fund. Emissions that can be purchased with the resources of pension funds annually will be equivalent to the needs identified and the procedure defined in Articles 13 and 16 of the Act Previsionales Fund, respectively Obligations. "* Declared unconstitutional || | Art. 4. Agréguense three paragraphs to Article 223 as well.
"The Administrators institutions, with the resources of the pension funds they manage, must purchase securities issued by the Social Housing Fund in order that the funds raised with the arrangement thereof they are used in granting loans to workers in the formal sector, with special emphasis on working heads of households, for the acquisition of new social housing, with a value of up to one hundred twenty eight minimum wages commerce sector and services. For these purposes, the administering institutions must invest the equivalent of three point eighty-five percent of the accumulated collection of pension contributions from the three months preceding the month in which the placement of the issued securities is made.
The securities referred to in the preceding paragraph shall be issued by the Social Housing Fund for a term of up to twenty five years at a fixed interest rate, not less than three per cent per annum, which will be the subject periodic review by that institution, always maintaining a differential of at least three percentage points over the lending rate in effect on the date of review established for loans for the purchase of housing social interest worth hundred twenty minimum wages in trade and services sector. The rest of the characteristics of the securities to which the preceding paragraph shall be defined by the Social Fund for Housing refers.
The securities issued by the Social Housing Fund in accordance with the provisions of the second and third paragraphs of this Article shall receive the same treatment as securities issued by the Directorate General of Treasury and the Central Bank have in the Securities Market Act and this Act, be subject only to a limit equivalent to the provisions of the second paragraph of this Article investment. The investment obligation to respect the second paragraph of this article will persist, while reasonably Social Housing Fund determine the need for issues of securities to which this provision. "
Art. 5. reformed Article 223-A as well.
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"Art. 223-A. Pension funds must compulsorily acquire Certificates Previsionales Investment corresponding to the Annual Program Emissions Trust pension obligations, without the total balance acquired exceeds the investment limit stated in paragraph m) of Article 91 of this Law. Also they must acquire Investment certificates Previsionales by transfer certificates and certificates of complementary transfer, for which not operate this limit be replaced. "* declared unconstitutional
Art. 6. This Decree shall enter into force eight days after its publication in the Official Journal.
GIVEN IN THE BLUE ROOM OF THE LEGISLATIVE PALACE: San Salvador, this twenty-ninth day of March in the year two thousand and twelve.
OTHON Sigfrido Reyes Morales, president. CIRO
ZEPEDA PEÑA CRUZ, GUILLERMO ANTONIO NAVARRETE GALLEGOS, FIRST VICE. SECOND VICE PRESIDENT.
MERINO JOSE FRANCISCO LOPEZ, ALBERTO ROMERO ARMANDO RODRIGUEZ, THIRD VICE. FOURTH VICE.
FRANCISCO ROBERTO DURAN LORENZANA, FIFTH VICE.
PEÑA LORENA GUADALUPE MENDOZA, CESAR GARCIA HUMBERTO AGUILERA, First Secretary. Second Secretary.

ELIZARDO LOVO GONZÁLEZ, JOSÉ ROBERTO MUNGUÍA d'Aubuisson, Third Secretary. Fourth secretary. LOURDES IRMA VASQUEZ PALACIOS, FIFTH Secretariat. SIXTH Secretariat.
MARIO ALBERTO GUERRERO TENORIO, SEVENTH SECRETARY.
PRESIDENTIAL HOUSE: San Salvador, on the thirtieth day of March in the year two thousand and twelve.
Published,
Carlos Mauricio Funes Cartagena President of the Republic.
Juan Ramon Caceres Carlos Enrique Chavez, Minister of Finance.
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No. 63 OJ No. 394 Tomo Date: March 30, 2012.
ROM / IELP 07-05-2012 UNCONSTITUTIONALITY
:
* THE CONSTITUTIONAL CHAMBER OF THE SUPREME COURT JUSTICE, BY MEANS OF JUDGMENT No. 42-2012, 61-2013 and 62-2013 published in OJ No. 3, T. 406, OF JANUARY 7, 2015, declared unconstitutional THE ARTS. 91 letter m) and 223-A, AS TO THE USE OF THE INTEREST RATE LONDON INTERBANK OFFERED RA TE HUNDRED EIGHTY DAYS (LIBOR 180 days) BEARING THE INVESTMENT CERTIFICATES accrues LES ISSUED BY THE TRUST INTERIM OBLIGATIONS, MANDATORY TO ACQUIRE THE PENSION FUND MANAGERS WITH PENSION FUNDS MANAGED TO MANAGE AND BY INFRINGEMENT OF LEGAL SECURITY IN CONNECTION WITH SOCIAL SECURITY LAW IN YOUR PROTEST OF OLD AGE PENSION FOR CONTAINED IN THE ARTS. 2 INC. 1 and 50 of the CN., RESPECTIVELY, AND KEEP THIS RATE INCIDE ADVERSE EFFECTS ON THE LEVEL OF PROFITABILITY TO BE OBTAINED BY THE SAVINGS OF LISTED NTES SYSTEM SAVINGS FOR PENSIONS AND ON THEIR RATES OF REPLACEMENT TO AFFECT materially PENSIONS OF SUCH POPULATION SECTOR TO CAUSE A DECREASE OF INCOME AND ESSENTIAL TO MEET MINIMUM BASIC NEEDS AND SO KEEP A WORTHY TO ALLOW THE ASSUMPTIONS OCCUR retirement; AS WELL AS SOCIAL SECURITY BREACH IN CONNECTION WITH THE PRINCIPLE OF PROPORTIONALITY, ARTS. 50 AND 246 CN., Respectively, while SUCH RATE, DUE TO LOW PROFITABILITY, NOT FOR COMPLIANCE WITH THE REQUIREMENT FOR USE OPTIMUM RESOURCE OF SOCIAL SECURITY, focusing ADVERSE EFFECTS ON THE LEVEL OF PROFITABILITY TO OBTAIN savings CONTRIBUTORS TO PENSION SYSTEM SAVINGS AND ON THEIR REPLACEMENT RATES, aFFECTING SUCH PENSIONS materially population sector. (JQ / 20/02/15)

JQ 20/02/15 LEGISLATIVE INDEX